B-127085, APRIL 23, 1956, 35 COMP. GEN. 569

B-127085: Apr 23, 1956

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TRANSPORTATION - ROUTES - MISROUTED SHIPMENTS - GOVERNMENT LIABILITY FOR EXCESS CHARGES THE LAST MOTOR CARRIER IN THE ROUTE OF MOVEMENT OF GOVERNMENT PROPERTY WHICH WAS SHIPPED UNDER AN UNROUTED BILL OF LADING IS NOT ENTITLED TO RECOVER FROM THE GOVERNMENT EXCESS CHARGES RESULTING FROM THE ROUTING OF THE SHIPMENT OVER A ROUTE OTHER THAN THE LOWEST-RATED ROUTE. THE GOVERNMENT IS NOT OBLIGATED TO PAY ADDITIONAL CHARGES AND THEN COLLECT FROM THE CARRIER RESPONSIBLE FOR THE MISROUTING. 1956: REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 21. THE RECORD SHOWS THAT BOTH OF THE SHIPMENTS WERE TENDERED TO THE CHANDLER TRANSFER COMPANY AT GAIRD. ON BILLS OF LADING WHICH WERE UNROUTED. THAT THE SHIPMENTS WERE TRANSPORTED FROM ORIGIN TO DESTINATION OVER THE LINES OF THE CHANDLER TRANSFER COMPANY.

B-127085, APRIL 23, 1956, 35 COMP. GEN. 569

TRANSPORTATION - ROUTES - MISROUTED SHIPMENTS - GOVERNMENT LIABILITY FOR EXCESS CHARGES THE LAST MOTOR CARRIER IN THE ROUTE OF MOVEMENT OF GOVERNMENT PROPERTY WHICH WAS SHIPPED UNDER AN UNROUTED BILL OF LADING IS NOT ENTITLED TO RECOVER FROM THE GOVERNMENT EXCESS CHARGES RESULTING FROM THE ROUTING OF THE SHIPMENT OVER A ROUTE OTHER THAN THE LOWEST-RATED ROUTE, AND THE GOVERNMENT IS NOT OBLIGATED TO PAY ADDITIONAL CHARGES AND THEN COLLECT FROM THE CARRIER RESPONSIBLE FOR THE MISROUTING.

TO PAUL V. ADAMS TRUCKING, INC., APRIL 23, 1956:

REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 21, 1955, IN WHICH YOU REQUEST REVIEW OF THE SETTLEMENT (CLAIM TK-589369) DATED DECEMBER 12, 1955, WHICH DISALLOWED YOUR CLAIM, PER BILL NO. S3-11172-11173, FOR $10.44 ADDITIONAL TO THE CHARGES PREVIOUSLY PAID YOUR COMPANY FOR TRANSPORTING TWO SHIPMENTS OF GOVERNMENT PROPERTY FROM GAIRD, ALABAMA, TO BANGOR, MAINE, UNDER GOVERNMENT BILLS OF LADING NOS. AF-2678532 AND AF-2678533, BOTH DATED OCTOBER 5, 1954.

THE RECORD SHOWS THAT BOTH OF THE SHIPMENTS WERE TENDERED TO THE CHANDLER TRANSFER COMPANY AT GAIRD, ALABAMA, ON BILLS OF LADING WHICH WERE UNROUTED, EXCEPT AS TO THE INITIAL CARRIER, AND THAT THE SHIPMENTS WERE TRANSPORTED FROM ORIGIN TO DESTINATION OVER THE LINES OF THE CHANDLER TRANSFER COMPANY, ASSOCIATE TRANSPORT, INC., AND PAUL V. ADAMS TRUCKING, INC. THE LATTER, THE LAST CARRIER IN THE ROUTE OF MOVEMENT, CLAIMED AND WAS PAID ON ITS BILL NO. S3-11172-11173 TRANSPORTATION CHARGES IN THE AMOUNT OF $40.43 ON THESE TWO SHIPMENTS. THESE CHARGES APPEAR TO HAVE BEEN BASED ON THE LOWEST AVAILABLE JOINT THROUGH RATES BETWEEN THE ORIGIN AND DESTINATION OF THE SHIPMENTS, ALTHOUGH PAUL V. ADAMS TRUCKING, INC., WAS NOT A PARTICIPATING CARRIER IN THE TARIFFS NAMING SUCH JOINT THROUGH RATES FROM GAIRD, ALABAMA, TO BANGOR, MAINE.

SINCE THE BILLS OF LADING INVOLVED IN THIS CASE WERE UNROUTED, THE INITIAL CARRIER, CHANDLER TRANSFER COMPANY, SHOULD HAVE FORWARDED THE SHIPMENTS OVER THE ROUTE WHICH WAS THE LEAST EXPENSIVE FOR THE SHIPPER. WHILE MOTOR CARRIERS ARE NOT COMPELLED TO ESTABLISH JOINT RATES OR ROUTES, WHERE THEY DO MAINTAIN THROUGH ROUTES WITH OTHER CARRIERS IT IS THE DUTY OF THE INITIAL CARRIER TO FORWARD AN UNROUTED SHIPMENT OVER THE LOWEST- RATED ROUTE. MURRAY COMPANY OF TEXAS, INC. V. MORROW, INC., 54 M.C.C. 442, 444; METZNER STOVE REPAIR COMPANY V. RANFT, 47 M.C.C. 151, 154; GREAT ATLANTIC AND PACIFIC TEA COMPANY V. ONTARIO FREIGHT LINES, 46 M.C.C. 237; HAUSMAN STEEL COMPANY V. SEABOARD FREIGHT LINES, 32 M.C.C. 31, 36. HAD THE INITIAL CARRIER PERFORMED ITS DUTY IN THIS RESPECT, THE AMOUNT ORIGINALLY CLAIMED AND PAID WOULD HAVE BEEN APPLICABLE, AND THERE WOULD BE NO CLAIM FOR ADDITIONAL CHARGES.

FOR THE REASONS GIVEN ABOVE, THE GOVERNMENT WAS ENTITLED TO THE BENEFIT OF THE LOWEST AVAILABLE JOINT THROUGH RATES APPLICABLE FROM ORIGIN TO DESTINATION IN WHICH THE CHANDLER TRANSFER COMPANY PARTICIPATED AS AN INITIAL CARRIER. WHICH CARRIER IN THE ACTUAL ROUTE OF MOVEMENT WAS RESPONSIBLE FOR MISROUTING THE SHIPMENTS SEEMS TO BE IMMATERIAL TO THE SHIPPER UNDER THE PARTICULAR FACTS INVOLVED IN THIS CASE. THE TRANSPORTATION CHARGES WERE CLAIMED BY, AND PAID/TO, THE LAST CARRIER IN THE ACTUAL ROUTE OF MOVEMENT, AND THIS WAS CONSISTENT WITH THE PROVISIONS OF CONDITION NO. 1 ON THE BACK OF THE GOVERNMENT BILL OF LADING. CONNECTION WITH EACH SHIPMENT, THE GOVERNMENT BILL OF LADING WAS SURRENDERED TO THE DELIVERING CARRIER AND THAT CARRIER USED THE BILL OF LADING TO SUPPORT ITS CLAIM FOR CHARGES. THUS, THE CARRIER WHICH CLAIMED AND RECEIVED PAYMENT OF THE TRANSPORTATION CHARGES HAD IN ITS POSSESSION THE EVIDENCE (UNROUTED BILL OF LADING) OF THE MISROUTING OF THE SHIPMENT AND OF THE RIGHT OF THE SHIPPER TO THE BENEFIT OF THE LOWEST AVAILABLE JOINT THROUGH RATE IN WHICH THE INITIAL CARRIER PARTICIPATED. IN THE DISTRIBUTION OF THE THROUGH REVENUE AMONG THE INTERESTED CARRIERS, THE DELIVERING CARRIER HAD THE MEANS OF PROTECTING THE REVENUE OF THOSE CARRIERS INNOCENT OF MISROUTING THE SHIPMENT AND ASSESSING ANY SHORTAGE IN REVENUE AGAINST THE CARRIER GUILTY OF THE MISROUTING.

YOU URGE, IN EFFECT, THAT SINCE THE INITIAL CARRIER HAS THE DUTY OF FORWARDING UNROUTED SHIPMENTS OTHER LOWEST-RATED ROUTE, THE GOVERNMENT, AS SHIPPER, SHOULD PAY YOUR COMPANY THE ADDITIONAL CHARGES APPLICABLE VIA THE ACTUAL ROUTE OF MOVEMENT AND COLLECT THE EXCESS FROM THE CARRIER GUILTY OF MISROUTING THE SAID SHIPMENTS. HOWEVER, NEITHER THE GOVERNMENT NOR ANY OTHER SHIPPER SEEMS TO BE REQUIRED TO BECOME A PARTY TO SUCH CIRCUITY OF ACTION.

THE CASE OF GALVESTON, HOUSTON AND SAN ANTONIO RAILWAY COMPANY V. LYKES BROS., 294 F. 968, INVOLVED A SITUATION IN WHICH THE INITIAL CARRIER ISSUED AN UNROUTED BILL OF LADING AND THEN MISROUTED THE SHIPMENT. THE DESTINATION CARRIER COLLECTED CHARGES FROM THE CONSIGNEE WHICH WERE BASED ON AN ERRONEOUS RATE AND THEN SOUGHT TO RECOVER BY COURT ACTION THE RATE APPLICABLE VIA THE ACTUAL ROUTE OF MOVEMENT. THE COURT REFUSED TO ALLOW THE DESTINATION CARRIER TO COLLECT ANY CHARGES IN EXCESS OF THOSE APPLICABLE VIA THE LOWEST-RATED ROUTE--- THE ROUTE OVER WHICH THE INITIAL CARRIER SHOULD HAVE FORWARDED THE SHIPMENT. ANOTHER CASE THAT SEEMS TO BE VERY MUCH IN POINT IS LANCASTER V. SCHREINER, 212 S.W. 19. IN THAT CASE THE INITIAL CARRIER MISROUTED THE SHIPMENT AND ON ARRIVAL AT THE BILLED DESTINATION THE DELIVERING CARRIER COLLECTED FROM THE CONSIGNEE THE CHARGES THAT WOULD HAVE BEEN PROPER OVER THE ROUTE OF MOVEMENT HAD THE SHIPMENT NOT BEEN MISROUTED. SUBSEQUENTLY, THE DESTINATION CARRIER SUED THE SHIPPER FOR THE DIFFERENCE BETWEEN THE CHARGES COLLECTED AND THE CHARGES APPLICABLE VIA THE ACTUAL ROUTE OF MOVEMENT. THE COURT SAID:

THE PLAINTIFF HERE CONCEDES THAT IF DEFENDANT IS COMPELLED TO PAY THE EXCESS SUED FOR IN THIS CASE HE CAN RECOVER THE SAME AGAINST THE CARRIER OR CARRIERS GUILTY OF MISROUTING THIS SHIPMENT. ITS CONTENTION IS THAT, ON ACCOUNT OF THE RIGID CONDITIONS OF THE INTERSTATE COMMERCE ACT, THE PLAINTIFF MUST SUE FOR AND DEFENDANT MUST PAY THE AMOUNT OF THE COMBINED LOCAL RATES OF THE ROUTE OVER WHICH THE SHIPMENT WAS ACTUALLY SENT, THOUGH BY NO FAULT OF THE SHIPPER, AND THE SHIPPER MUST THEN IN TURN SUE FOR AND RECOVER THE EXCESS WHICH HE IS THUS FORCED TO PAY FROM THE OFFENDING CARRIER. WE SEE NO REASON, HOWEVER, WHY THE PLAINTIFF, IF IT HAS NOT RETAINED ITS OWN CHARGES IN FULL, AS TO WHICH WE ARE NOT ADVISED, SHOULD NOT ITSELF SUE SUCH OFFENDING CARRIER TO ADJUST SUCH DIFFERENCE. * * * WHY SHOULD PLAINTIFF BE ALLOWED TO RECOVER FROM DEFENDANT FOR THE BENEFIT OF THE OFFENDING CARRIER THE VERY AMOUNT WHICH SUCH OFFENDING CARRIER MUST REFUND TO DEFENDANT? WE SEE NO REASON FOR TWO SUITS WHERE ONLY ONE, IF ANY, IS NEEDED. THE CASE IS THE SAME AS IF THE SHIPPER ON ASCERTAINING THE THROUGH RATE AND DESIGNATING THE PROPER ROUTE HAD PAID THE INITIAL CARRIER THE CORRECT AMOUNT OF CHARGES FOR THE THROUGH SHIPMENT. THE INITIAL CARRIER WOULD THEN BE RESPONSIBLE FOR THE THROUGH SHIPMENT, THOUGH PART OF THE ROUTE WAS OVER A CONNECTING CARRIER. THE CONNECTING CARRIER BECOMES IN A MEASURE AT LEAST THE AGENT OF THE INITIAL CARRIER TO COMPLETE THE SHIPMENT * * * AND THERE IS SUCH CONTRACTUAL RELATION BETWEEN THE TWO CARRIERS THAT THE CONNECTING CARRIER COULD HOLD THE INITIAL CARRIER FOR ITS LAWFUL SHARE OF FREIGHT CHARGES. * * * WE SEE NO REASON, THEREFORE, WHY PLAINTIFF, IF ANYTHING IS YET DUE, SHOULD NOT LOOK TO THE INITIAL OR PRECEDING CARRIER FOR ANY REDRESS DUE IT RATHER THAN TO SEEK TO COLLECT FROM DEFENDANT FOR THE BENEFIT OF THE OFFENDING CARRIER MONEY WHICH MUST BE AGAIN RETURNED TO THE DEFENDANT.

ACCORDINGLY, SINCE THERE APPEARS TO BE NO LIABILITY RESTING UPON THE GOVERNMENT FOR THE PAYMENT OF ANY EXCESS CHARGES RESULTING FROM THE MISROUTING OF THE SHIPMENT BY ONE OF THE CARRIERS IN THE ROUTE OF MOVEMENT, AND NO DUTY ON THE PART OF THE GOVERNMENT TO PAY ADDITIONAL CHARGES TO ONE CARRIER AND THEN SEEK TO RECOVER THE SAME CHARGES FROM ANOTHER CARRIER, THE SETTLEMENT IS SUSTAINED.